Detroit pension funds adviser to pay $3.1 million to settle SEC case

7:12 PM, June 10, 2013

Detroit Free Press Staff Writer

A Florida businessman has agreed to pay nearly $3.1 million to settle claims that he secretly stole millions of dollars from a City of Detroit pension fund to buy two shopping malls in California, according to a court filing today by the U.S. Securities and Exchange Commission.

The SEC announced the settlement on the same day it filed a civil lawsuit against Chauncey Mayfield and several others, alleging that in 2008, Mayfield stole $3.1 million in pension funds that “could have provided a year of benefits for more than 100 retired police officers, firefighters and surviving spouses and children.” But Mayfield, a former investment adviser to two City of Detroit pension funds and founder of MayfieldGentry Realty Advisers, didn’t do it alone, the SEC said.

Four other MayfieldGentry officials at his firm helped him cover it up, the SEC said:

■Blair Ackman, 42, of Livonia, chief financial officer.

■Marsha Bass, 59, of Bloomfield Hills, chief operating officer.

■W. Emery Matthews, 40, of Detroit, former chief investment officer.

■Alicia Diaz, 50, of Grosse Pointe, former general counsel, executive vice president and chief compliance officer.

None have been charged with any crimes. They are only defendants in a civil lawsuit.

According to the SEC, the four executives gradually became aware of Mayfield’s theft and devised a plan to secretly repay the pension fund by cutting costs at the firm and selling the two malls. But MayfieldGentry could not raise enough capital to put the stolen amount back into the pension fund.

Mayfield’s Washington, D.C., attorney, A. Scott Bolden, would only say, “Chauncey Mayfield is pleased to have put the DOJ (Department of Justice) matter and the SEC matter behind him as he continues to move forward with his life, which is his ultimate goal.”

In mentioning the DOJ, Bolden was referring to Mayfield’s other brush with the law.

In February, Mayfield, 56, of Ft. Lauderdale, Fla., pleaded guilty to conspiring with former Detroit Treasurer Jeffrey Beasley to pay him bribes in exchange for new business.

Beasley, a former fraternity brother of former Detroit Mayor Kwame Kilpatrick, is facing criminal charges on accusations of taking bribes in exchange for approving more than $200 million in pension fund investments.